Feds Warn Of Data Deletion In Megaupload Case, Other Docs Still Under Seal

US agents have finished copying data from servers that contain information on Megaupload, the controversial file-sharing site shut down earlier this month. While a number of documents in the case are still under seal, a newly-public letter suggests the fate of the data is now in the hands of the private companies that are hosting it.

In a letter filed in federal court late Friday and embedded below, a US Attorney wrote:

Should the defendants wish to obtain independent access to the Mega Servers, or coordinate third-party access to data housed on Mega Servers, that issue must be resolved directly with Cogent or Carpathia. It is our understanding that the hosting companies may begin deleting the contents of the servers beginning as early as February 2

The two companies are based in the US and were the targets of raids that coincided with the unsealing of an indictment against Megaupload and its founders. The comment about possible data deletion created a stir after the Guardian and others reported it this morning. Critics like Cory Doctorow have said the federal government could be complicit in the destruction of personal photos and the music of independent bands, but it is unclear what percentage of the files are this type of material and what percentage are simply things like bootlegged copies of the Fast & the Furious.

The attorney’s letter, like other aspects of the Megaupload case, appears to be driven driven in part by political calculations. (The government, for instance, decided to unseal the indictment one day after Hollywood interests expressed frustration at the collapse of proposed anti-piracy legislation known as SOPA and PIPA.)

The attorney’s letter may be a way to inform users of the Megaupload service that their data could be lost. Or it may be a warning to other communications companies about the risks in providing services to file-sharing companies. The share-price of publicly-traded Cogent Communications tanked after news of the indictment broke ten days ago. Neither Cogent or privately-held Carpathia immediately returned calls for comment.

Documents under Seal

Other documents in the case remain under seal. They likely contain additional details about the case and could be part of the US government’s efforts to persuade other countries to extradite the Megaupload defendants:

In the US criminal system, prosecutors often do not put all of their evidence into an initial indictment — instead they put what was needed to persuade a grand jury.

The standard of proof needed to obtain a grand jury indictment is much lower than an actual conviction (in the words of author Tom Wolfe, a grand jury “would indict a ham sandwich”).

The case is unlikely to be resolved anytime soon as the US government must first resolve extradition proceedings in New Zealand where Megaupload’s gun-toting founder, Kim Dotcom, remains in jail. Two others made bail and three other defendants are still at large.

In another development, the Wall Street Journal (NSDQ: NWS) reported
this weekend that the federal government has been giving a low-profile to prosecutors and agents involved in the case. The paper reported that the government is concerned about retaliatory attacks from the hacking group Anonymous, which crashed several government servers in response to the Megaupload shutdown.